week 1 checkpoint financial management goals

week 1 checkpoint financial management goals - company...

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Week One Checkpoint – Financial Management Goals 1 Week One Checkpoint – Financial Management Goals Melissa Krol FIN 200 September 8, 2010 Instructor Name: John G. Oladokun Axia College University of Phoenix
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Week One Checkpoint – Financial Management Goals 2 Week One Checkpoint – Financial Management Goals It is common to think that it is more important for financial managers to make the highest possible profit for the company. With this goal in mind all decision making would be based on its overall contribution to the company’s earnings. Using this philosophy can raise risks and cause the company to be undesirable leading stockholders to sell. A better goal is to maximize the wealth of the company’s stakeholders through achieving the highest possible value for the company. One can do this by taking more than just the shareholders into consideration when making decisions as well as the short and long-term effect of any decision. Management can do this by adopting policies that are attractive to the public in general which raises the value of the
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Unformatted text preview: company attracting capital, providing employment, and benefits to the community. One would say this is being socially and ethically responsible, but being socially and ethically responsible may seem that one is not being consistent with the goal of achieving the highest possible profit or maximizing the value of the company. But not raising the stock prices immediately or in the short-term does not mean the company will continue to realize those kinds of gains or losses. A company can have a loss in the short-term and then gain tremendously in the long-term, which would be in reaching for that primary goal of maximizing the wealth of the shareholders through achieving the highest possible value for the company. Week One Checkpoint Financial Management Goals 3 References Block Hirt Danielsen. (2009). Foundations of Financial Management (13th ed.). The McGraw Hill Companies....
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This note was uploaded on 11/09/2010 for the course FIN 200 FIN 200 taught by Professor Smith during the Spring '10 term at University of Phoenix.

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week 1 checkpoint financial management goals - company...

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